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V >y^t-/ Introduction THE present system of taxation in the Province of Ontario being practically the same as when the Province was first created, has now become, in a large measure, uns^ited to pre- sent conditions, and, in the last few years, various amendments have been suggested. The Retailers' Association submitted a bill to tax Departmental Stores. The Municipalities sought to have amend- ed tiie section which enabled corporations to escape with a "scrap iron" valuation of their plant. Manufacturers asked for exemptions for their machi ery and stork, and the Single Taxers wantf d all Munici4 ^iitics to have wider powers of local self-governmei . and the right of experime- - ing in taxation. During the Ses ^'^ t quo, at the request of the Premier, the varioi o amend the Assessment Act were withdrawn . i Commission was appo'nt- ed to consider the wh. fe matter of taxation. The Commission held pul sessions, extending over three weeks, and the e 4€ntc taken, and docu- ments presented, were published vetbatim in their interim report of 1901, and their final report, con- taining their recommendations, is now before the public. Thr Sin-;lc Tax Association appoints a com- mittee to review the report, to point t t to the public the failure of the Commission t. find any solution of the probh.ms they were appointed to consider, and, finally, to indicate the direction in which tlie ideal syst •. of taxation must lie. We now submit to the student of taxation, and to the pubUc generally, our criticism of the report. SINGLE TAX ASSOCIATION Toronto. May 1st, 19 lO. General R.efnarks. IN reviewing the gcnrral subject »>f taxation, the Commissioners express themselves at a loss to find any equitable principle for its adjustment. They say on page 1 7 : Excluding the single ta>c on lon'l vahie. the principUs suL'^'ostc.l appear to \tc twc : ( I. ) Taxation in proportion to altility to p:iy. (2 ) Taxation in proportion to municipal bitufits rer- vnl. Ability may be the ri^btone for reiij;iinisnn I < harit \)ili- piiri>n».s, as also for national purjwses ; and it is the one generally »o!i»ider«d appHoable in local taxation. It may be. however, that for the pur- posejof municipal taxation, the principle of paynu-nt for U-nefits received from the Municipality should have some application. Probably neither nrincipk- can 1-e applied with more than an approximation to accuracy, rosslbly, indetd, il can 1)C demonstratid that t* -two apparently different principles are really one and .he same .iiinjj. Being thus undecided as to whic h principle is right, it was only natural to expect that they would follow neither, but would adopt a compromise. Their perplexity h shown by the following ad- missions : It seems impossible in all cases to follow the same or analojcous methods (page 24). The praclibilil "f assess- all corporation- upon the same ba-is as private indi ills seei.... to be doubtful (paKe32). It does not neem practicable to formulate a system of taxation -which shall be applicable to both companies and private persons. If the l.ix on personal property is abolished in the case of priv te persons, it ought in theory also to be abolished in the case of COT janies (page 21). The whole difficulty arises from the fact that the Commission have followed no settled principle of taxation. Had they followed the plan of tax- ation according to benefits received, there would have been no difficulty in assessing both indivi- duals and corporations equitably alike; for the benefit anyone receives from government is mea- sured by the value of the land used or occupied by them. When people pay for land they are actually paying for the benefit conferred by government. He who would enjoy the benefits of a govern- ment must use land within its jurisdiction. He cannot carry land from where government is poor to where it is good ; neither can he carry it from where the benefits of good government are few or enjoyed with difficulty to where they are many and fully enjoyed. He must rent or buy land where the benefits of government are available, or else forego them. And unless he buys or rents where they are greatest and most available, he must forego them in degree. Consequently, if he would work or live where the benefits of govern- ment are available, and does not already own land there, he will be compelled to rent or buy at a valuation which, other things being equal, will depend upon the value of the government service that the site he selects enables him to enjoy. Thus does he pay for the service of government in proportion to its value to him. But he does not 6 pay the public which provides the service — he lii required to pay the landowners. Land is the only kind of property that is increased in value by government ; and the in- crease of value is in proportion, other influences aside, to the public service which its possession secures to the occupant. Therefore, by taxing land in proportion to its value, and exempting all other property, kindred monopolies excepted — that is to say, by adopting the tax on land values only — we would be levying taxes according to benefits received from government. In no just sense can this be called class legisla- tion. Indeed, the cry of class legislation comes with very bad grace from the owners of valuable land, when it is considered that under our present system of taxation they are exempt. Even the poorest and most degraded toilers in the community, besides paying the landowners for the opportunity of occupying and using the land, are compelled in various ways to contribute to the support of government, while the owners of the valuable land go free. They enjoy all the advantages of govern- ment, the protection of the courts, the police and fire departments ; they have the use of the schools and the benefit of the highways and other public improvements, and, though they go through the form of paying taxes and often pose as " t?ie tax- payers," yet, iu fact, they pay no taxes. From 7 the industrious occupants they collect, in some cases, vast revenues, and out of this collection they surrender a portion to the Municipality ; but the real taxpayer is the producer. Enjoying the same intangible benefits of government that others do, many of them as individuals and all of them as a class, receive in addition a tangible pecuniary benefit which government confers upon no other property-owners. The value of their property is enhanced in proportion to 'the benefits of government which its occupants enjoy. To tax them alone, therefore, is not to discriminate against them; it is to charge them for what they get. TKe Two Acre Exemption IF, however, no principle is discoverable in the report of the Commission, a bias in favor of the land-owning class at least is apparent. For example, the act wliich permits two acres of vacant land in the hands of specubtors to be taxed as farm lands, quite irrespective of its use, while adjoining knd is assessed at its full market value, is not condemned, but only some slight modifica- tions are suggested. This act is a particularly objectionable piece of class legislation. It dis- criminates against the improver in favor of the speculator, against the small speculator in favor of the large one, against the small landowner with the solitary lot in favor of the great landowner having acres of idle land in towns or cities. 8 Local Option. ONE principle which was urgently pressed on the attention of the Commission, and which has been in operation in New Zealand, British Columbia and the North-west Territories, namely local option or home rule for local taxation, does not even receive mention in their report, although wherever it has been tried it has worked satisfactorily. It is only by allow- ing Municipalities to experiment and test the soundness of new theories that a just system of taxation can be reached. Recommendations. We will now consider in their order the recom- mendations of the Commission as found on page 35. (1) Assessment of Laud —that real property be assessed at its actual value, including mineral lauds and the real property of all corporations. (See Bill sec 37. ) That the right of use by any person of highways or other public places, in addition to the structures thereon, be assessed at actual value. This first clause has the fatal defect of ignoring the distinction between the value of the land caused by the community and the value of the building and other improvements effected by the individual. If it had been worded as follows:— Assessment of Zanrf— That land be assessed at its actual value, including mineral lands and the lands of all corporations. Then it would accord with justice. The second clause, strictly interpreted, would assess the lands of railros^tls at their full value for railroad purposes, which is the way they ought to he assessed. It is to be regretted, however, that the Commission did not so interp; at this clause, for in section 56 of their bill it is provided that if these lands have escaped their fair share of taxation in the past, then ten years must elaj 2 before they can be assessed at their full value. No such con- sideration is shown to any individual who makes an improvement on his land. (2) Assessment of Personal Proftrty — That the assessment and taxation of personal property other than income be abolished. This is a step in the right direction. The ob- jections to a personalty tax are so strong, and the cxperienct^ of its operation such a dismal failure, that its abolition wps a foregone conclusion, and the Commission are entitled to our thanks for this decision. But it is when they recommend a sub- stitute for it that we find that custom and prece- dent have been stronger than their sense of justice or their knowledge of scientific taxation. The following is tlieir proposal: (3.) Taxution in lieu of Tox on Ptrsonal Propttly. — That in lieu of the tax on personal property the following method of taxation be adojted : (a) Tax all persons (with some exceptions in the case of ccrtpin corporations) with reference to their income (subject to a suitable exemption), in ni/jst cases indirectly, but in some cases directly upon income. ( b ) Where a person's income is tlerived from trade, manufacture, or financial or commercial business (private bankers and brokers excepted ) in cities, towns and villages, tax the person by reference to the rental value of the premises occtT'^d for the purpose of his business, insteatl of directly upon iiicon;-.. (Se* 'Hill sec. 7. ) 10 (c) In the case of persons fol 'owing other callings (includinj? pivate bankers and brokers), exempt income up to »i,ooo; where ii come is more ihan Si.ooo, but not more than ., and instead of giving our criticism we will content ourselves by giving their own, as taken from their general remarks on taxation when speaking of these very taxes : — The objections urged against an income tax are thus summed up by Professor Cooley : "Any income tax is objectioual)le because it is inquisitorial, and because it teaches the people eyasion and fraud . " " No means at the command of the Government has ever enabled it to arrive ^^:♦h anything like correctness at the incomes of its citizens, and they .esist ?ts imposition in all practicable moove ; the tax falls with great iucqualily upon the nienil)ers of the class, and by the failure to realize the amount which should properly come from the whole class the proportion of taxes payable by other classes, notably the real estate owners, who t^re always reached, is Uuduly increased. In spite, however, of the foregoing, and much more of the same character, they determine to continue it in a modified form. In order to assess 12 I the incomes of those they wish to reach, tliey d - mand that -j./^-ployers shall disclose the salarier. i)f their employees ; irKjuisitorial powers are given to assessors, oaths are demanded, and in order still further to ferret out the delinquent, who, scorn* ng ostentation, may modestly seek to conceal his princely income, penalties ranging from $ioo and upwards are threatened. Some people will not learn, even from the experience of 2000 years, and what the Roman assessor, backed up by the autho- rity of the Empire, supplemented by torture and mutilation, could not do, they propose to accom- plish by means of an oath. In this connection the following paragraph from page 1 1 of their report is interesting : — "The extent to which the existing system of Luxation in the United States has obliterated the sense of honesty in its people in their individual dealings with the Government, removeil all repug- nance to the act of perjury, and caused each one to justify himself to his conscience for making a false return in the matter of taxes hy the supposition that everyone is doing the same, is also strikingly illus- trated by the circumstan,-" that a IIi<. 'i Court in one of the States of the Federal Union has recently decided that ' perjury in connection with a man's tax lists does not affect his general credibility undir oath.'" The truth is, that an income tax ignores alike the sources of a man's income, his opportunity for earning, and the obligations which, aside from tax- ation, he has to meet, and therefore cannot, in thr nature of the case, be other than unjust and thcrr - fore inexpedient. I'd Business Tax. WE now come to the Business Tax, and with it we will consider the analogous House Tax set forth as follows : — (4) Houte /"(/jr— Impose in cities, towns and villages, as a sup- plementary tax, a tax on all owners and occupiers of houses ( meaning by that term buildin^i^s usetl as dwelling places) by assessing them for the rental value of the house, subject to a deduction by way of exemption graded according to the population of the Municipality. (See Bill sec. 15.) Stated shortly, the result of the above recommendations would be that (a) in cities, towns and villages, everj- person in commercial or financial business (private bankers and brokers exLepted) and (b) every other person whose income is not more than 1>4,ooo, would be taxed on the rental value of his business premises and of his residence; (c) that persons having no calling would be taxed on their income (subject to exemptions) and on the rental value of their residence, and that (d) persons (including private bankers and brokers) fol- lowing callings not commercial or financial, and having income not exempt, of more than ?4,ooo, would be tared on the rental value of their dwelling place and places of business and directly upon their income above $4,000. It being apparent to the Commissioners that a general income tax would be impracticable, large exemptions were suggested, and, to reach those exempt from income tax, they recommend the above new taxes, but, realizing that their principles are unsound, they proceed to hedge these taxes about with exceptions and exemptions. If the rental tax was based on the principle of the heading they give to its discussion (page 20) viz: — "Tax on rental value of land occupied " there would be no objection to it, for, as has been shewn again and again, a tax on land values does not increase the prirr of anythhxj mmi mokes. It It does not decrease the demand for lahor. It does not increase the capital recjuircd to huild a house or to carry on a business, and it does not decrease the comfort of living to the workers. But when the tax is partly levied on the building, it is open to all the objections to a tax on labor products It increases the rent of houses, dis- courages the building of houses, and to that extent decreases the demand for labor. It decreases wages and tends to lower the standard of comfort for all workers, and encourages tiie pernicious system of land speculation. The immediate effects of the house or business tax will be to decrease the rental received by the owner by nearly the whole amount of the tax paid by the occupant to the Municipality, until a relative reduction m the supply of houses will enable the house owners to raise the rent sufficiently to recoup themselves, and until such time it virtually amounts to the confiscation of so much house value. So we find that though the Commissioners are strongly opposed to levying an increased burden on land values, although admittedly these values are produced by the community, they do not scruple to recommend a couJUfcation, as tfin/ term it, of a portion of a man's capital invested in improvements. As a result of this new confmatifyi of labor products, they say: — We think alio that the returns from the new tar pro],ni«il inj ii< »hould, by e.rr'','(liny the olitms mnr rvceivM from the lai- mi jn'ruDnal property, re^ull in subifantial nlief •r I -chaser an v ►ayer, the 'icr of the tiniply « prt lium fur •rrepilarly t sing part iilarlv v;iving ; ^ of a priv c owner or not. At the same ti.ne it is. not th<- stw .Jiat all larads should be governmental property, .■»© that t» ' en n new terri- torities, where the land has not yet 'w^n *n,U\ aa>4 piriv tc owners created, would it seem that the Su.i^lc Tai. retention of ownership by the Crown He w>^ best to have the land nominall> ibe h^nd prevent embarrassment in its di-- ution • < collection of taxes. The Commissioners then as follows : — No instance can be pointed to as a prei e>j«:u .a which a com- munity comprising a great variety of interest- has madr evperiment of the system. The effect of its immediate adi , ition would ibviously and admittedly be to confiscate either wholly or in gre.it part the property of one class of the community. It cannot he sai ' ;n Ontario that landowner* have acquired their property I'v force or traiid. They have purchased it. The policy of the country ever since it became a civilized one has been to confer and recognize ownership in land as well as in other property. To alter that policy, and without compen- sation f deprive owners of their property lawfully acquired, iavolvL , 17 wrMsld < vocate the 4 .»i -'ntu sly think it vnie owners, to art," the property of anyone. On the contrary it would leave them in full enjoyment of all that their title deeds call for, viz:— quiet onjo« -nent sub- ject to the payment of taxes. It would do more, lor it would relieve them from the fine which is now levied on every attempt to use land for the purpose of production, and would make no longer profitable to use it for the purpose of extor- tion or speculation. We have already shown (page 6) that it would be levied strictly in accordance with the benefits derived from government. Strange to say, the Commif'iioners have not accepted this as the true principle of apportionment. On the contrary they acknowledge that they know of no principle of taxation, and therefore base their objections to the Single Tax, not on the fact that the principle 18 f-i -1, is unsound, but on two propositions which, strip- ped of verbiage, are — no precedent and confisca- tion. No Precedent THE first of these statements is inrorrect. New Zealand is a "community comprisinji; a ^reat variety of interests," and has had a measure of single tax for years, with very bene- ficial results, and over 60 municipalities derive all their local taxes from land values only. In Canada the City of Nanaimo, B.C., does the same. In the rest of British Columbia improvements are exempt by law to the extent of 50%, and may, at the option of each municipality, be exempt entirely. In the rural districts of Manitoba the taxes ?re levied upon the unimproved value of the land only, and has giver such satisfaction that no one even suggests going back to the old system. All ot these facts were brought to the attention of th. Commission, but they have not only ignored them but virtually denied hearing of them. What Was the Commission to Do ? Now, quite apart from the question of what has been done by other people, the Commission was appointed to enquire into and report upon the whole matter of taxation, and to suggest such changes and improvements as mighi seem advi.c- able. How they could construe this to limit their 19 scope only to the consideration of systems in vogue elsewhere does not seem apparent. If the present system is bad, and if the systems existing else- where are bad also, it seems clear that common sense would suggest that careful consideration should be made of the true principles of taxation, and, if necessary, an entirely new system should be formulated — based upon these principles. This they have not attempted to do, but instead have suggested taxes which they themselves admit are thoroughly discredited, and take rei'u^e in the st.it (»- ment that they never heard of any other system in actual operation. IstHe Land Tax Confiscation? WE now come to the second objection, namely, confiscation. It is a principle accepted by all legislators, and acted on by this Com- mission, that government cannot grant to anyone, either the assurance that there shall be no change in the system of taxation, or that, in the event of such a change, those adversely affected shall receive compensation. This principle has been freely acted upon by our Government, in times past, and not always vnth even handed justice. Every change in the TarilT affects some one adversely, and the change is usually made for the purpose of taxing money out of the pockets of one class of citizens in the 20 interests of another, and generally much smaller, class. Yet no one talks of compensation. Every reduction m a tariff reduces the value of goods imported at the higher rate, but there is no thought of compensation. Not only is this so, but a tax on houses such as recommended by the Commis- sion, will reduce the value of house property, yet they give no hint of compensation. It is suggested by them that the business tax and house tax, with the franchise tax, will relieve land of some taxes that mean adding to its selling value, yet there is no talk of compensation in the shape of a payment to the Government by the landowners benefited. It is only when the land interest is adversely affect- ed by the change of taxation that the compensa- tion bugaboo is raised. No question of what land values are, how they arise, or the justice of one class in the community appropriating to them- selves all the benefits which come through increase in population, improved methods of production of wealth, or increased facilities of transportation and communication, disturb them. Their chief care seems to be to see that the ground owner shall remain in undisturbed possession of his privilege of living on the industry of others, and so they give as their final reason for the adoption of these crooked taxes, that if taxation is not to be borne by land alone, some substitute for the dis- credited personalty tax must be found, (page 2<]) In contrast to the report we have just reviewed, we pewit to the following minority report of tb.e Royal Commission on Taxation, appointed by t'te Imperial Parliament in 1899, drawn by Judge O'Connor of the English Bar. 21 r 1 r Report of a Royal Commission on Taxation. THE following is an abstract of a report by the Honorable Judge O'Connor, K. C., (formerly Arthur O'Connor, M.P.), a mem- ber of a commission appointed by the British Parlirment to enquire into the method of Local Taxation. Property in Goods versus Property in Land Now, between land and every other form of other property there is an obvious, abiding, and essential difference. Every other form of property IS transitory, wasting and destructible, the tem- porary production of human industry obtained by labor out of the material which the land si rr lies ; but the land is not of human production ; and as no man made it, so no man can destroy it ; " no man, however feloniously inclined, can run away with an acre of it." Man's very body is built up of its substance ; he is taken from it, and will return to it; while he lives, he must live and labor upon its surface. Equity and right reason would appear to suggest that tlie product of human industry should be the absolute property of the person or persons that created it, whether 22 the creation be of food, or habitation, or instru- ment, or any other thing. But with the land it is different. Equity and right reason here suggest that, as access to the face of the globe is for man- kind a necessary condition of existence, and yet land is incapable of creation by human industry, the same rule of absolute and exclusive ownership cannot apply. Ensland Belongs to the English; But — It is, then, in accordance at once with reason, equity, and the law, to say that England belongs to the English ; that the land of England, with all that IS beneath its surface, and all that it produces by the unassisted force of nature, belongs to the people of England. The facts of the existing situation, however, furnish an extraordinary contrast with this natural and equitable view. The 32,000,000 acres of country which stretch from Berwick-on-Tweed to Land's End, and which bear upon their bosom a population of 30,000,000 of human beings, are divided between a comparatively small number of free^ jlders, collectively forming only a tiny frac- tion of the inhabitants. These freeholders part with the occupation right of the different portions of the land only on terms which, from generation to gener?tion, and from decade to decade, are con- tinuously advancing, whilst the overwhelming mass of the community, who are born, and live, 2S and labor, and are buried in it, can exist on it only on condition of payment to the freeholders. Thus the population of England is divided into two classes, one comparatively small, and the other immense, the one composed of the owners of the land, and the other composed of the non- owners of land. The first, qua owners simply, "toil not, neither do they spin," but they receive from the majority of their fellow citizens a quit- tance amounting to more than a hundred millions sterling in the year ; while the second or indus- trial class, have to labor not only for their bread, but also to pay for their foothold in the country. Population Makes Land Value. The amount which the industrial portion of the community have in this way to pay out of the pro- duce of their labor increases with the increase of their own number. It is only the presence of man that gives value to land. Land at the North Pole has no value, because men are no- there ; it is of comparatively small value when .pie are few, as on Salisbury Plain ; it is of vci high value in the City of London, by reason of the concourse of people who desire to use it. Value is only the measure or token of the amount of human effort which anything of service can command at any given time or place. It does not signify how that effort may bo induced, or what mav be the motive 24 of it. The association of beautiful scenery, the proximity of a harbor or market, the accessibility of minerals, agricultural fertility, commercial con- venience, or any other attraction, may furnish a special inducement to compete for a particular spot, but the bare requirement for ground to ?=-tand or sleep on will, with an increasing population of non-owners of land, secure for the owner an increased tribute. Land Values and Improvamant Valuas. These considerations will be enough to show how essential a difference there is between the two kinds of property now liable to berated, viz., land and buildings, and how reasonable and equitable it is that land or interest in land should be made the subject from which the services in the public interest should be supplied. A little furtiier con- sideration will show in how different a position any other form of property stands. The increase in valuation, which has been so noticeable during the last fifty years, is due to the increased value of houses as well as to increase in the value of land. But a marked distinction must here be made. It is true that there has been a very much larger amount of money laid out in houses than was the case before ; but this is a matter of expense, of sinking capital in the employment of labor, and in paying for materials. A structure 25 once efected remains a perishable commc lity, maintained in condition only by the constant expenditure of more material and more labor, but on these conditions houses can be multiplied according to the multiplication of the people, as coats and books and other created commodities all can. But the land is constant in quantity and limited, and has to do for all, however many. Again, if each of two men resolve to build a house of a certain size and style, but one of them builds his house in an out-of-the-way part of Salisbury Plain, and the other of them builds his house in Cornhill, it is probable that the former, baring to transport labor and material, will have to pay more for the erection of his Salisbury Plain struc- ture than the other would spend in London where the conveniences are greater. But the Cornhill house would readily let at a rent many times as great as the other house would command. The difference in rent would represent the difference in site value, and not the difference in structural value. The distinction between site value and structural value represents a difference not of degree only, but of kind. The structural value is due to individual action; the site value depends on the action of the community. If it is suggested that an individual may do much to develop a site value, the obvious reply is that whatever he so does is included in his individual property as being of his own creation. If he should also 28 be the freeholder this will in no way affect the matter. The improvement which he creates, he creates not in his capacity of mere landowner, but in his capacity as an industrial member of the community, and equity requires that he should have the full benefit of it. But the land which he owns is no more of his creation than it is of his neighbor's, though his ownership marks him off from the majority of his fellow citizens as one of the class endowed with the land of the country. If an owner of agricultural lands builds a farm house with its necessary accessories, having, perhaps, reclaimed or drained the land, made or paid for the roads, erected the fences and con- structed the ditches, etc., he is, in respect of his having created a farm as a going concern, as much an industrial member of society as the ship- builder, the tailor, the doctor, or the ploughman, and as such is a benefactor of society. Society may well be satisfied with the service which he thus renders, and leave his buildings and improve- ments unburdened by taxation. But with regard to the land on which his intelligence and resources have been exercised, he is debtor to the commun- ity at large, as being ' ^ . ivileged and protected ownership and occupation of a portion of that common patrimony which belongs to the com- munity first, and to him only in a secondary and conditional manner. S7 i. Land Values Should be Rated. Again, if upon the banks of the Tyne land- owners have for generations allowed to lie useless a low and swampy stretch, until some energetic, enterprising and intelligent industrial, taking it at a rent, digs out a dock and starts the business of a shipbuilder, organizing labor, creating employ- ment, gathering a vast army of workers, and develops a town, and if with every increase of service which he thus renders to his fellows he is constrained to pay to the landowners, who have all the while done nothing, a constantly increasing rent, until land, originally worth a pound a year is now worth a thousand, is it not in accordance; with reason and justice that the thousand a year should be rated in the hands of the landlords rather than that the shipbuilder should be further charged ? The structural value of the created property is maintained or increased only by con- stant expenditure by the individual on construc- tion and repair of buildings and machinery. The whole value added by reason of the increase of men upon it attaches to the land, and inures U) the advantajjje of those bet'veen whom the interests in the land arc divided. 28 Debate on tHe Land Tax in tHe Commons The Reports cf the British Commission on local taxation, of which Judge O'Connor's report is printed above, came up for discussion in the Imperial Parliament on February igth. The specific issue was a motion by Mr. Trevelyan, a Liberal, for the second reading of a bill for enabl- ing cities to levy site value taxes for local pur- poses. It was expected, as Mr. Trevelyan explained, that the first benefit to flow from this measure would be the forcing into the market of " vacant land which was ripe for building." Some further idea of the nature of the bill may be had from the following extracts from the speeches : — Mr. Ilolden (Liberal) for the bill.— Tlie site value !• something which is due not to tlic exertion of the owner of the land, but to the movement of the population, and is therefore a proper subject for just and equitable treatment in the way of adjusting the burdens it ought to bear. Mr. Cripps (Conservative) opposed.— The site value is taxed at present as part of the real estate. If that is lo, what justification is there for putting any exceptional tax upon it. It can be justified only on this unearned increment doctrine ; and if that doctrine is to prevail, a special burden might as well be put on railway stock in the case of a line deriving its prosperity from the growth of two towns which it connects, or on the interest on debentures as com- pared with ordinary stock, Mr. McCrae (Liberal) for the bill. — In Scotland at the last general election there was hardly a Unionist candidate who did not commit himself to the taxing of site values. . . . It is fair and sound that a tax should be levied on Ian '. which improves in value, and that a building, which depreciates >.. »lue should be to that extent relieved. At present, land in this country does not bear its fair share of taxation, Tbu great advantage of the bill comes in not only as a tax 29 reform, but u • solution of the heutinf quMtlon. . . . One of the main reMont that can be adduced lor the propoul that land, and unuted land, ought to be Used, U that this would force more land into the market and therefore cheapen Ita price. One of the principal speakers in sapport of the bill was Sir William Vernon Harcoart, who was Chancellor of the Exchequer in 1894, and retiicd from the leadership of the Liberal party in 1898. The bill had been introduced by Liberals, the Tory ministr having refused to act, and conse- quently its deft.it was a foregone conclusion. For in Ei.gland the landed interests bear much the same relation to the party in power that trust interests bear in the United States. But, defeated though the bill was, the vote was significant. Though the usual ministerial majority is from 150 to 200, the majority against the bill was only 71, the vot being 158 for second reading and 229 opposed. To the principle of the measure, how- ever, the Liberal party is now pretty thoroughly committed, and so strong was the showing in its favor in the Commons that a belief is spreading that even the Tory ministry will soon have to put forward some kind of proposal for site value taxation. How wide the swath which this theory of tax- ation has cut in the Liberal party is indicated by the atvitude towards it of so notable a man in politics and commerce as Sir Christopher Furniss, member of Parliament for Hartlepool, and head of several business concerns. He has recently made 30 another pronounced declaration on the subject. It appears in the Pall Mall Magazine, in an article over his signature, on the American commercial "invasion" of the old world. Referring to the heavy burden imposed on British industry by mining rents and royalties, he warns the parasitical landlord class in no ambiguous terms. We quote : I am not the man to support anjr wild and revolutionary thcorlca of coafitaation, but the mineral rents and royalties of thU country are undoubtedly excessive, and I would warn the " gentlemen of England " that property has duties as well as rights, and that if, while shirking those duties, as In the manner of local rates, thejr impose on trade and industry burdens grievous to be borne, which they themselves touch not with one of their little fingers, they will only have themselves to thank should such theories become more and more popular. The miners work for wages they receive ; the colliery owners also earn their profits, when they get them, and those profits over a term of years will not average over five per cent, on the capiul worked. If, therefore, special taxation Is to be Imposed upon those connected with the mining Industry, It should surely be levied upon the royalty owners rather than upon the coal owners and the miners. That this is no idle threat, but the expression of a conviction regarding the question of public revenue, is made clearer farther on in the same article. Having opposed taxes on imports and exports, the distinguished writer asks : — " If, then, no tax is to be levied on our exports in the interest of the nation at large, how is the country to pay for the exceptional increa^^^d national expenditure ? " And here is his blunt answer to the question : — " / see nothing for it but to take iq) the question of taxation of hmd values " 81 Professor Sellf^inan and Single Tax. PROFESSOR SELIGMAN was an authority much quoted before the Commission, and accepted by them as an authority, so the following statement made by him, over his own signature, in a paper written for the Massachusetts Single Tax League, and read January loth, 1902, will be of interest : — " To the extent that the tiniile taxert are showing the Iniquity of the personal property tax and the essential practical injustice of our present methods, there is substantial harmony between them and the economists. To the extent that they emphasize the element of privilege as over against Individual labor, there is again substan- tial agreement between them and the economist. But whereas the single taxers desire to have all imposts assessed on the land, the ordinary economist will supplement this land tax, or the reul estate tax, with a tax on corporations and with a tax on inheritances, in tht hope of reaching in that way some of the other forms of privilege, and most economists will not even object to a well considered system of indirect taxes, which, lilie the internal revenue system of the United States, on a peace footing, combines a maximum of pro- ductivity with a minimum of injury to legitimate industrial interests," 82